Fletcher steel plans cleared

By LIBBY MIDDLEBROOK

Fletcher Challenge could tighten its grip on the steel market. The Commerce Commission has approved its second application to take over Steel and Tube Holdings.

The commission, which rejected Fletcher's earlier application, yesterday cleared its steel division to acquire up to 100 per cent of Wellington-based Steel and Tube.

Fletcher acknowledged it is in negotiations with Australian-based Broken Hill Proprietary, which is keen to sell its 50 per cent stake in Steel and Tube.

Fletcher spokesman Barry Akers said: "It's still too early to say whether we will acquire that holding or any other."

The commission refused Fletcher's initial application in October because of market dominance concerns. Fletcher submitted a second application last month after commissioner Mark Berry said the acquisition should be allowed to go ahead.

Fletcher included additional information particularly related to the market for distribution of merchant steel products and the market for distribution and processing of steel plate products.

A majority of the commission was now satisfied Fletcher's acquisition would not make it dominant in any of the markets affected.